UPDATE 1-Australian government considers help for struggling Qantas

* Airline due to report first-half loss this week

* Airline declines to comment on reports of job cuts, asset
sales
(Updates with government comments on support, possible changes
to ownership)

SYDNEY Feb 25 The Australian government said on
Tuesday it is looking at ways to assist Qantas Airways Ltd
after the carrier declined to comment on reports it is
preparing to axe up to 5,000 jobs and sell some assets.

Qantas has warned that it will post a first-half loss of up
to A$300 million ($270.53 million) when it reports its earnings
on Thursday.

The airline said it will be making "some tough decisions" in
order to achieve its goals of A$2 billion cost savings over the
next three years and convince both the government and investors
it has a turnaround strategy in place.

However, it declined to comment on local media reports that
between 3,000 and 5,000 jobs could go and that it plans to sell
its terminal at Melbourne Airport.

Qantas has been lobbying the federal government for
financial assistance, claiming arch rival Virgin Australia's
access to foreign funding via its major shareholders
Gulf carrier Etihad, Singapore Airlines and Air New
Zealand, has created an unfair playing field.

Qantas is seeking a government debt guarantee to give it
access to cheaper capital.

Prime Minister Tony Abbott said it was in Australia's
interests for Qantas to "survive and to flourish" as a major
employer for the country.

"This government will do what it can to give it a level
playing field," Abbott said in parliament, adding that the
airline needed "to put its own house in order."

Transport Minister Warren Truss said the government is
drafting changes to the Qantas Sales Act to lift the current 49
percent foreign ownership limit as well as alter restrictions on
smaller shareholdings for foreign airlines.

The opposition Labor and Greens parties have vowed to block
any such move in the upper house, which would stop it becoming
law.

Dec 9 American Airlines Group Inc said
higher average fares per mile have boosted its revenue and
profit expectations for the fourth quarter, a day after rival
United Continental Holdings Inc also raised forecasts.

WASHINGTON, Dec 9 U.S. wholesale inventories
fell as previously reported in October amid a surge in sales,
supporting views that inventory investment would provide a
modest boost to economic growth in the fourth quarter.

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